Experts say banks and NBFCs to work together for India's development goals

Industry analysts quoted by Fortune India contend that a coordinated approach between scheduled banks and non‑bank financial companies (NBFCs) is essential for India to meet its long‑term development objectives. They point out that banks bring a vast deposit base, extensive branch networks and a strong regulatory framework, while NBFCs offer greater flexibility, niche product expertise and faster credit delivery.
The complementarity, they say, can broaden credit availability for sectors such as infrastructure, MSMEs and affordable housing, thereby supporting the government’s ambition to transition to a developed‑economy status. By leveraging each other's strengths, the financial system could improve financial inclusion and channel more private capital into growth‑critical projects.
However, the experts caution that effective collaboration will require clear policy guidance, harmonised supervision and robust risk‑management practices to prevent regulatory arbitrage. They urge the RBI and other regulators to facilitate a level playing field while preserving the distinct roles of banks and NBFCs.
In summary, the consensus among the experts is that a symbiotic relationship between banks and NBFCs can act as a catalyst for India’s economic transformation, provided that oversight mechanisms keep pace with the evolving partnership.